Is there a way for entrepreneurs to better influence venture capitalists?
.
Do your research and find out what you and the VC have in common. Similarity is key, so give them reasoning that works for their style of thinking, not necessarily yours.
“…venture capitalists evaluate more favorably opportunities represented by entrepreneurs who “think” in ways similar to their own.”
Investigating the factors that influence venture capital decision-making has a long tradition in the management and entrepreneurship literatures. However, few studies have considered the factors that might bias an investment decision in a way that is idiosyncratic to a given investor-entrepreneur dyad. We do so in this study. Specifically, we build from the literature on the “similarity effect” to investigate the extent to which decision-making process similarity [shared between the investor and the entrepreneur] might bias or otherwise impact the investor’s evaluation of a new venture investment opportunity. Our findings suggest venture capitalists evaluate more favorably opportunities represented by entrepreneurs who “think” in ways similar to their own. Moreover in the presence of decision-making process similarity, the impacts of other factors that inform the investment decision actually change in counter-intuitive ways.
Source: “‘I LIKE HOW YOU THINK’ – SIMILARITY AS AN INTERACTION BIAS IN THE INVESTOR-ENTREPRENEUR DYAD” from Journal of Management Studies
Join 25K+ readers. Get a free weekly update via email here.
Related posts:
Things you didn’t know about negotiation, persuasion and influence
7 of the most powerful persuasion techniques by expert Robert Cialdini (Video)
